Crypto Stocks Take Steep Hit Compared to Wall Street in End of Week Drawdown
Stocks started off the week in a rally, with wide benchmarks like the S&P 500, NASDAQ Composite, and Dow Jones posting gains.
But the rally fell off with a sharp pullback Friday on new worries of increasing Fed rate hikes. The retracement was nearly enough to wipe out the gains from earlier in the week, but not quite.
Stocks Yikes: Strong Jobs Data Could Mean More Fed Rate Hikes
As Joe Rennison and Isabella Simonetti at the New York Times explain, new hires slowed some in September, but not as much as expected.
The strength of the labor markets to add new hires is good economic news, but it could also indicate inflationary Fed lending over the dovish regime is still coursing through the economy. As a result, the Fed is expected, based on the new labor numbers, to continue raising rates. That ultimately affects crypto stock prices.
The latter got pulled down in the headwind as well as stock prices. That slowed earlier gains major cryptocurrencies had made.
Crypto Stocks Taken for Wild Ride by Headwind
Silvergate Corporation (NYSE: SI), a bank that serves crypto companies, fell nearly 5% Friday. Core Scientific (NASDAQ: CORZ) was down 13% for the day. Hut 8 Mining Corp (TSE: HUT) plunged nearly 7% Friday. Marathon Digital Holdings (NASDAQ: MARA) was down over 14%. Riot (NASDAQ: RIOT) fell 8%. HIVE (NASDAQ: HIVE) dropped 6%.
Compare that to the benchmark averages. The Dow Jones fell, but only 2%. The S&P 500 retraced at a steeper 2.8% loss for the day. Tech-heavy NASDAQ, with more high-risk, high-growth stocks, finished worst of the three for Friday, with a 3.8% loss.
Crypto stocks are all considered higher risk than the riskier tech stocks, heavily weighting the NASDAQ composite. So, their segment of the market bore the brunt, percentage-wise, of a risk-off macro market Friday. Crypto stocks did, however, see steeper gains as well earlier in the week when stocks and crypto were rallying.
The post Crypto Stocks Take Steep Hit Compared to Wall Street in End of Week Drawdown appeared first on CryptoPotato.
OhNoRipple via https://www.ohnocrypto.com/ @Wesley Messamore, @Khareem Sudlow